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Kalagara Rama Tulasamma Vs. Subhadaya Publications Ltd. - Court Judgment

LegalCrystal Citation
SubjectCompany
CourtAndhra Pradesh High Court
Decided On
Case NumberA.A.O. No. 537 of 1964
Judge
Reported inAIR1969AP207
ActsCompanies Act, 1913 - Sections 3(1), 164 and 199 to 201; Code of Civil Procedure (CPC), 1908 - Sections 38 and 39
AppellantKalagara Rama Tulasamma
RespondentSubhadaya Publications Ltd.
Advocates:A.V. Koteswara Rao, Adv. for ;K. Suryanarayana and ;Y.B. Tatarao, Advs.
Excerpt:
.....rs.4,15,150/- awarded by the tribunal was enhanced to rs.8,20,000/-. - i therefore, fail to see how a district court can have no jurisdiction to enforce the said order. it clearly states that it 'may be enforced in the same manner' in which decrees of civil courts made in any suits pending therein may be enforced......or sent it for execution to a subordinate court in the same manner as it sends its decrees for execution passed in civil suits to the subordinate court. it is not, therefore, necessary that the transferee court also should be a company court. any such contention would practically amount to flying in the face of s. 199. it is difficult to accept the contention that the expression 'in the same manner' relates only to the procedure and does not authorise the district court to execute the order. section 199 does not indicate any such distinction. it clearly states that it 'may be enforced in the same manner' in which decrees of civil courts made in any suits pending therein may be enforced. the word 'manner' in my opinion is comprehensive enough to include a subordinate court which can.....
Judgment:

1. This is an appeal directed against the order of the Additional District judge, West Godavari passed on 4-7-1964. It arises in the following circumstances.

2. In O. P. No. 195 of 1964, the High Court of Madras brought the Subhadaya Publications limited in liquidation. In pursuance of the liquidation, an order to collect the call money from the appellant was made by the said High Court. The High Court of Madras transmitted that order for the purpose transmitted that order for the purpose of enforcement to the High Court of Andhra Pradesh. The high Court of Andhra Pradesh in its turn transferred the said order passed in O. P. No. 195 of 1964 to the District Court, Eluru under R. O. C. No. 4296/63-C2 for execution. An execution petition was filed by the Official Liquidator before the District Court for the execution of the said order. The prayer in the said execution petition was that the said execution petition was that the moveable property of the judgment-debtor should be attached.

3. The judgment-debtor appeared and filed a counter. His principal contention, with which I am concerned, was that the District Court has no jurisdiction to execute the order as it is not a company Court with in the meaning of Section 3 of the Indian Companies Act (7 of 1913), hereinafter called 'the Act.' The District Court rejected this contention and directed execution of the order. It is this view that is now question in this appeal.

4. The principal contention of the learned Advocate for the appellant is that the District Court is not a Court within the meaning of S. 3 of the Act and consequently it cannot execute any order calling upon the judgment-debtor to pay the call money passed by the Madras High Court in liquidation proceedings. In support of this contention, he relied upon Kayastha Trading and Banking Corporation Gorakhpur v. Jai Karan Lal, AIR 1927 Pat 182.

5. In order to appreciate the implication of this contention it is necessary to read a few provisions of the Act. Section 3 reads as follows:

' (1) The Court having jurisdiction under this Act shall be the High Court having jurisdiction in the place at which the registered office of the company is situate: Provided that the Central Government may, by notification in the Official Gazette, and subject to such restrictions and conditions as it thinks fit, empower any District Court to exercise all or any of the jurisdiction by this Act conferred upon the Court, and in that case such District Court shall, as regards the jurisdiction so conferred, be the Court in respect of all companies having their registered office in the district.'

I am not concerned with the other sub-sections of S. 3.

'Section 164: Whether the High Court makes an order for winding up a company under this Act, it may, if it thinks fit, direct all subsequent proceedings to be had in a District Court: and thereupon such District Court shall for the purpose of winding up the company, be deemed to be 'the Court' within the meaning of this Act, Court' within the meaning of this Act, and shall have, for the purpose of such winding up all the jurisdiction and Section 199:

All orders made by a Court under this Act may be enforced in the same manner in which decrees of such Court made in any suit pending therein may be enforced. Section 200: Any order made by a Court for or in the course of the winding up of a company shall be enforced in any place in India other than that in which such Court is situate by the Court that would have had jurisdiction in respect of such company if the registered office of the company had been situate at such other place, and in the same manner in all respects as if such order had been made by the Court that is hereby required to enforce the same.

Section 201: Where any order made by one Court is to be enforced by another Court, a certified copy of the order so made shall be produced to the proper officer of the Court required to enforce the same, and the production of such certified copy shall be sufficient evidence of such order having been made and thereupon the last-mentioned Court shall take the requisite steps in the matter for enforcing the order, in the same manner as if it were the order of the Court enforcing the same.'

6. A careful reading of all these provisions would not leave anybody in doubt that under Section 3 the High Court of the State is statutory treated as the Court unless under the proviso, the Central Government by a notification empowers any District Court to exercise all or any of the jurisdictions conferred upon the High Court under the Act. It is stated before me that under the said proviso the Central Government has not issued any notification constituting anyone of the District Courts in the State of Andhra Pradesh as a Company Court within the meaning of Section 3. I will therefore, take it that is the High Court of Andhra Pradesh which is the Company Court under S. 3 of the Act.

7. The three Ss. 199 to 201 relate to the enforcement of the order passed by the Company Court. Section 200 states that an order passed by one Company Court can be enforced by any other Company Court in India in the same manner in all respects as if such order had been made by the Company Court that is required to enforce the same. This provision therefore, empowers the High Court of Andhra Pradesh to enforce any order passed in pursuance of liquidation proceedings by the Madras High Court, which is a Company Court in so far as that State is concerned. It also lays down that such an order shall be enforced in the same manner in all respects as if that order was made by this Court. Section 199 states that all orders made by a Company Court under the Act may be enforced in the same manner in which a decree of a Civil Court made in any suit pending therein may be enforced. When these two sections are read together, the inevitable result is that while under Section 200 the High Court of Andhra Pradesh can execute an order passed by the Madras High Court, Section 199 empowers this Court to enforce the order in the same manner in which the decrees of this Court passed in suits can be enforced.

8. Section 201 merely lays down the mode of dealing with orders to be enforced by other Courts. It says that where any order made by a Company Court is to be enforced by another Court, a certified copy of the order so made shall be produced to the proper officer of the Court required to enforce the same. It further says that the production of such certified copy shall be sufficient evidence of such order having been made. It directs that upon the production of such certified copy, the Court shall take the requisite steps for enforcing the order in the same manner as if it were the order of the Court enforcing the same. The last limb of Section 201 reiterates what has already been laid down in Sec. 199. When a certified copy of the order passed by the Madras High Court is produced before this Court, this Court shall take suitable steps to enforce it. It may not be necessary that it must be produced to the proper officer of this Court by only the liquidator. I cannot find any objection if the certified copy is produced or sent by the Madras High Court to this Court for the purpose of enforcement. What all Section 201 requires is that the certified copy of the order sought to be enforced is product before the Court. Once such a copy is before the Court, the statute raises a presumption that it is sufficient evidence that such an order was made by the Madras High Court. It is up to this Court them to take the requisite steps in the matter of enforcing the said order.

9. Now, it cannot be in doubt that the necessary steps which can be taken for enforcement of the order would be almost the same as are usually taken by this Court in execution of the decree when it passes the same in a civil suit. It is here that Ss. 38 and 39, C. P. C. come in for consideration. Section 38 enacts that a decree may be executed either by the Court which passes it, or by the Court to which is sent for execution. Section 39 authorities the Court to send the decree for execution to another Court in cases where the person against whom a decree is passed actually and voluntarily resides or carries on business, or personally works for gain, within the local limits of the jurisdiction of the transferee Court, Section 39(2) undoubtedly requires that the Court, which passed a decree, may of its own motion sent it for execution to any subordinate Court of competent jurisdiction. The question of competency of jurisdiction of the transferee Court has to be determined in reference to the execution of the order as if it is a decree passed in the civil suit and not in reference to S. 3 of the Companies Act as is urged by the learned Advocate for the appellant before me. I have already stated that Section 199 of the Act lays down that the order can be executed in the same manner as if it was a decree passed by Court on the civil side. When that order is transferred for execution to the District Court, what has to be seen is whether the amount involved in the order for the realisation of which the order is transferred for execution to the transferee Court falls within the pecuniary jurisdiction of the transferee Court. The District Court has unlimited pecuniary jurisdiction. In this case, the amount sought to be recovered is only Rs. 1000. It can hardly be doubted that the District Court, to which this Court has transferred the order for the purpose of enforcement, is a competent Court within the meaning of S. 39(2). Civil P. C. I therefore, fail to see how a District Court can have no jurisdiction to enforce the said order. This Court in exercise of the powers under Section 39, Civil P. C. read with S. 199 of the Act rightly transferred the order for the purpose of execution to the District Court which, as stated earlier, is a competent Court to execute that order.

10. What was, however, urged was that it is the Company Court which alone is competent to execute the order and since the District Court is not a Company Court, it cannot execute the order sent to it by this Court. It is not possible to accept this contention. It is true that the District Court has not been made Company Court by any notification under Section 3. Section 164 is not quite relevant for this purpose. What S. 164 concerns itself is with the subsequent winding up proceedings and not enforcement of any order passed by a Company Court. The language of Section 164 is plain enough to indicate that the Company Court, which has passed orders of winding up, can direct any District Court to conduct the subsequent proceedings. The order, which is under my consideration and which has come from the Madras High Court for enforcement, can not be an order which falls within the ambit of S. 164. That section therefore, is inapplicable to such a case. It is only under Section 200 that this Court, which also is a Company Court, gets jurisdiction to enforce the orders in cases where certified copies of such orders are produced before it under Section 201. While enforcing that order. Section 199 expressly empowers this Court to enforce that order in the same manner as if it was a decree in a civil suit passed by this Court and it is under this provision that Sections 38 and 39. Civil P. C. get attracted under which this Court would be competent to transfer the order for execution to a competent subordinate Court. It will thus be plain that while initially the certified copy must be produced before a Court within the meaning of Section 3, I. e., to say a Company Court, when once the certified copy is received by the Company Court, the Company Court has jurisdiction to either directly execute it itself or sent it for execution to a subordinate Court in the same manner as it sends its decrees for execution passed in civil suits to the subordinate Court. It is not, therefore, necessary that the transferee Court also should be a Company Court. Any such contention would practically amount to flying in the face of S. 199. It is difficult to accept the contention that the expression 'in the same manner' relates only to the procedure and does not authorise the District Court to execute the order. Section 199 does not indicate any such distinction. It clearly states that it 'may be enforced in the same manner' in which decrees of Civil Courts made in any suits pending therein may be enforced. The word 'manner' in my opinion is comprehensive enough to include a subordinate Court which can execute the order if such an order is transferred for enforcement by this Court in its jurisdiction as Company Court.

11. I am fortified in my view by a decision of the Madras High Court in the Master of British Banking and Industrial Corporation Ltd. Bombay, 25 Mad LW 113 = (AIR 1927 Mad 271). That is an identical case. In that case, applications were made to the High Court of Madras for directing the respective District Courts to enforce the payment orders made by the Bombay High Court in the matter of the winding up of the Company. Negativing the contention similarly raised therein, Srinivasa Aiyangar, J. held:

'I rather think that the proper procedure as indicated by the conjoint effect of Sections 199 and 200 of the Companies Act is that the order now filed in this Court should be treated in the same manner as a decree passed by this Court and transferred for execution to the respective District Courts.

'There will therefore be an order in all these applications directing the transfer of the order to the District Court concerned for execution by that Court against the contributory in the same manner and to the same extent as if the order was a decree passed by this Court.'

12. It is true that in AIR 1927 Patna 182, a Bench of the Patna High Court held: -

'Reading Sections 199 and 200 together the Court mentioned in Sections 200 and 201, as the Court entitled to take requisite steps is not a District Court but a High Court. Hence a decree of the Allahabad High Court in liquidation proceedings cannot be sent direct for execution to the District Court of Gaya (within Patna high Court's jurisdiction)'.

It will be clear from the judgment that an order passed by the High Court of Allahabad in liquidation proceedings was transferred by the Allahabad High Court to the District Court, Gaya directly. The District Judge held that under S. 200 read with Section 3 of the Act, he was not competent to deal with such a case and struck off execution. The contention was that as a result of Section 199, Sections 38 , 39 and 40 of the Civil P. C. would apply and as a decree in a suit by the Allahabad High Court can be transferred for execution to the District at Gaya, the same procedure was correctly followed in these liquidation proceedings. It is this contention which was negatived. It is in this context that the following observation made in the judgment has to be understood: -

'Now the Court described in these two sections is not the Court of the District Judge as he has rightly pointed out, but it would be this Court, Sections 199 and 200 must be read so as to be consistent with each other. If the interpretation placed upon Section 199 by the learned advocate for the appellant is correct, then Section 200 would be swept away altogether'.

13. It will thus be plain that in that case the certified copy was not produced before the Patna High Court, which was the Company Court so far as that State was concerned. If the procedure followed in this case had been followed in that case there could not have been any objection. The sending of the certified copy directly by the Allahabad High Court to District Court, Gaya was not permissive because the District Court of Gaya was not a company Court although it could execute the order transferred by the High Court of Patna; It could not directly receive the certified copy and enforce the same as that will be quite contrary to Section 200 of the Act. That decision, therefore, does not lay down anything contrary to what I have stated earlier.

14. In Natarajan v. Narasimha, AIR 1930 Mad 74 this question was left open by the Bench. It observed:

'We do not propose to decide the question, in what manner, in the event of an application being made to the High Court, is the order to be enforced, by direct action or by itself being transmitted to the Tanjore Court That is a point which does not arise at present.'

That decision, therefore, is not helpful.

Since I am in respectful agreement with the Madras decision in 25 Mad LW 113 = (AIR 1927 Mad 271) and no decision contra has been brought to my notice. I would hold that the learned District Judge was right in holding that the District Court had the necessary jurisdiction to enforce the order transferred to it by this Court. I can find, therefore, no valid reason to interfere.

15. The appeal, therefore, fails and is dismissed. No order as to costs.

16. Appeal dismissed.


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